The Final Fantasy: Government Projections

Let's keep this simple.

July 1, 2009 - the official unemployment rate is 9.5%, but if you include those who have given up or have gone to part time, it is about 16%.

1. February, 2009: On the right is an "official graph" from President Obama. Note how the rate should be just be rebounding from the 8% barrier.
Also note, the evil Bush economy without any of Obama's fixes would average, say, 8.5% this year. I guess the party line is Bush hid things so well the Obama team could tell what was going on.

2. February 2009: CBO:

		2008	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019
	Unemployment Rate	5.70%	8.30%	9.00%	8.00%	6.80%	5.80%	5.10%	4.90%	4.80%	4.80%	4.80%	4.80%

The CBO said the high for 2009 would be 8.3%. It is still June.

3. The IMF projections in a report from last year: U.S.: 6.84% for 2009.

So, the question is not why did you believe these people, it is why do you still listen?

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Below is from forecast.org, as of May 18, 2009. This group has not gotten the memo or doesn't have enough Harvard economists.

U.S. Civilian Unemployment Rate Forecast

Percent Unemployed Seasonally Adjusted.

Month	Date	Forecast Value	50% Correct +/-	80% Correct +/-
0	Apr 2009	8.90	0.0	0.0
1	May 2009	9.2	0.2	0.5
2	Jun 2009	9.5	0.3	0.6
3	Jul 2009	9.8	0.3	0.7
4	Aug 2009	10.1	0.3	0.7
5	Sep 2009	10.4	0.3	0.8
6	Oct 2009	10.6	0.4	0.8
7	Nov 2009	10.8	0.4	0.8
8	Dec 2009	10.9	0.4	0.9

Note, the 9.5% is dead on for June. These private groups are ruining things for the government monster mash. Anyway, plan for the real world. For example, an unemployment of 10.9% by years end, perhaps. It may be higher as business close down or move as a result of new legislation. The economy is just starting to stumble, not rebound because the stock market went up. [Of course, Obama is pointing to the stock market as a good sign, but if you recall, in February he was dismissive of the markets.]

On the web site for forecasts.org there is a table containing the interesting current economic indicator:

Inflation %: -1.1%

Guess what that means. Indeed, it should be called: " Deflation %."

We can look at this one of two way, the FED screws up and we head into deflation, which can lead to depression, or the FED succeeds and we move to hyperinflation. Of course, Congress and Obama have already thrown in 9,000 pages of new laws, which makes it impossible to even guess what will happen,

I guess you hold money in case there is a continued deflation, but if you see a quick reversal (FED jacking up interest rates fast), then get out of cash.